Revenues within the hardware encryption market have been forecast to increase at a compound annual growth rate (CAGR) of 62.17% through over the next five years, increasing from a value of approximately $14.86 billion at the end of 2013, to hit a total of $166.67 billion by 2018.
Similarly, volumes are estimated to grow from roughly 59.76 million units to 691.79 million units in 2018 at a CAGR of 63.20%. This growth is heralded by the growing consumer electronics applications market for hardware encryption products.
The hardware encryption applications in the Military Defense and Aerospace (MDA) applications sector is also expected to grow rapidly in the coming five years.
The major difference between hardware encryption and software encryption is that in hardware based encryption, encryption and decryption processes are done by a dedicated processor on the hardware encrypted device. In software encryption, the resources of the device on which the software is installed, are used for the encrypting and decrypting the data.
This makes hardware encryption much faster. Another advantage to hardware encryption is that the cryptographic key is stored in a separate inaccessible portion of memory storage, thus making it more secure than software encryption.
The total addressable market (TAM) revenue for hardware encrypted hard disk drives is estimated to grow from $48.57 billion in 2013 to $146.37 billion in 2018. Thus, the market penetration of hardware encrypted HDDs into this TAM stands at 20.07% in 2013 and is expected to grow to 69.05% by 2018.
According to a recent report, 'Hardware Encryption Market: Analysis & Forecast 2013-2018', Asia-Pacific holds the major share of the hardware encryption market with expected revenue of roughly $5.15 billion in 2013. The CAGR of the market's primary base - APAC, for the period 2013 to 2018 is calculated to be 58.40%.
Europe and North America are the fastest growing regions, with expected CAGRs of 64.03% and 63.69% respectively from 2013 to 2018, due to the major growth spurts expected in the consumer electronics sector in the developing countries in this region.
For more information on the hardware encryption market, see the latest research: Hardware Encryption Market
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